Arevon Initiates $600M, 250MW/1,000MWh Cormorant Battery Project
- Energy Storage News Utility-Scale BESS
Marin Holt
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- 5 minutes read
- 250 MW / 1,000 MWh lithium iron phosphate battery system using Tesla Megapack containers
- $600 million capital investment — nation's largest urban battery storage project by capacity
- Located in Daly City, California; long-term offtake with MCE serving 1.8 million residents across 4 counties
- Groundbreaking March 24, 2026; commercial operations targeted for 2027
Arevon broke ground March 24, 2026 on the Cormorant Energy Storage Project in the Bayshore neighborhood of Daly City, California — a 250 MW / 1,000 MWh lithium iron phosphate battery system built with Tesla Megapack containers. At $600 million, Cormorant is the largest urban battery storage project in the United States by capacity and is expected to reach commercial operations in 2027.
What Is Being Built
The project pairs 250 MW of discharge capacity with 1,000 MWh of stored energy — a four-hour duration system capable of delivering full rated output through peak demand windows. Arevon selected Tesla Megapack as the battery container technology. The site sits within the suburban San Francisco grid, where Daly City sits on the peninsula directly south of the city, in an area served by PG&E’s transmission network.
MCE — the Marin Clean Energy community choice aggregator — holds a long-term offtake agreement for the project’s output. MCE serves approximately 1.8 million residents across Contra Costa, Marin, Napa, and Solano counties. The Cormorant project’s stored energy will be dispatched during peak demand periods to reduce reliance on natural gas peaking units and manage the grid voltage excursions that accompany sharp afternoon load ramps in the California market. Construction supports roughly 175 jobs at peak.
Why It Matters
Urban battery storage at this scale is rare. Most large BESS projects in California are sited at remote substations or adjacent to utility-scale solar farms in the Central Valley or desert. Daly City is a dense, built-out suburb where real estate is expensive and permitting for energy infrastructure is difficult. Arevon’s ability to site a 250 MW system in Bayshore — within the Bay Area’s transmission-constrained import path from the east — signals that urban BESS projects can compete on economics and permitting even in high-cost jurisdictions. For utilities managing demand charges and voltage excursions in metropolitan areas, a local storage resource provides load relief that remote assets cannot replicate: it avoids transmission losses and can respond to localized demand without relying on congested import paths.
Critical Perspective
Cormorant’s economic viability depends on California ISO market conditions over a long-term revenue horizon. The state’s battery storage fleet has grown rapidly — California now has over 10 GW of installed BESS — and storage prices in CAISO’s real-time and capacity markets have compressed as more projects compete for the same peak-demand revenue windows. A $600 million urban project carries higher per-MWh capital costs than rural alternatives. MCE’s offtake agreement provides revenue certainty for the project, but the terms have not been disclosed; ratepayer advocates have raised questions about whether community choice aggregators are locking in long-term storage contracts at prices that will look expensive when next-generation battery chemistries enter the market in the late 2020s.
